li guoping is a geographer on the staff of the china science academy's research center. his area of study is the northeast industrial region. there are over 1,000 factories in the tiexi industrial ne, which spreads along the west side of shenyang. many state-owned enterprises have factories here. they are typical of those that made up the backbone of the sialist economy. ( speaking chinese ) translator: one of the problems facing the tiexi industrial zone at the present time is the aging of its plants and uipment. quite a lot of it is old and is still in use after more than 20 years. actually, some of this equipment has been used for more than 30 years. the second problem ithat most of the factories in the region make everything they need in-house. this inefficient use of resources has resulted in many factories operating in the red. narrator: the shenyang number one machine tool works in tiexi is one such operation. its long history goes back to 1935, when manchuria was occupied by japan. the japanese established the region as a base of manufacturing for export to japan